The agency has also reaffirmed its 'CRISIL A1’ rating on the short-term bank facilities of the company.
CRISIL Ratings stated that the outlook revision factors in a sustained improvement in the business risk profile of PPPL.
Revenue increased to Rs 785 crore in fiscal 2024, from Rs 758 crore in fiscal 2023, led by volumetric sales growth of around 10% owing to steadily improving demand and better capacity utilisation.
Operating efficiency remains healthy, marked by return on capital employed ratio of 29% and operating margin of 17% in fiscal 2024, against 21% and 11.5% respectively in the previous fiscal.
The financial risk profile continues to be supported by healthy accretion to reserve, limited reliance on external debt and strong liquidity.
The ratings continue to reflect the established market position of PPPL in the speciality paper segment, supported by the extensive experience of the promoters and management team and its wide product portfolio.
These strengths are partially offset by exposure to intense competition and cyclicality in the paper industry and susceptibility of profitability to volatility in raw material prices.
Pudumjee Paper Products was set up in January 2015 to take over the paper manufacturing division of Pudumjee Pulp & Paper Mills Ltd, Pudumjee Industries Ltd and Pudumjee Hygiene Products Ltd. The company manufactures a variety of speciality, printing and tissue paper at its plant in Pune, which has capacity of 72,000 tonne per annum.
Operating income for fiscal 2024 stood at Rs 785.19 crore with net profit at Rs 98.14 crore, compared with revenue of Rs 758.88 crore and net profit of Rs 59.40 crore during last fiscal.
The scrip rose 0.76% to currently trade at Rs 97.07 on the BSE.